In 1972, federal legislation began allowing Medicare beneficiaries to join a Medicare-qualified health maintenance organization (HMO), rather than receiving care through the traditional Medicare program. Until the 1990s, there were few Medicare HMOs and enrollment was modest. From 1993 to 1998, both the number of Medicare HMOs and beneficiary enrollment tripled. Since 1998, federal legislation has profoundly changed payment to Medicare HMOs, and HMOs nationwide have responded in ways that include raising enrollees' costs, curtailing or eliminating optional benefits (e.g., prescription coverage), leaving certain markets, or terminating their Medicare contract. In the face of this substantial growth through 1998 and the turbulence that followed, there is little to indicate how the quality of care provided by Medicare HMOs compares with traditional Medicare (FFS). The proposed study is uniquely positioned to evaluate the quality and health outcomes experienced by beneficiaries in traditional Medicare and Medicare HMOs in the period since 1998. In 1998, we established a cohort of Medicare beneficiaries aged 65 and older drawn from 13 states with the largest, most mature Medicare HMO systems (MA, NY, PA, FL, IL, MN, TX, NM, AZ, CO, CA, OR, WA). From 1998-2002, we monitored and compared the quality of primary care and health outcomes of this cohort using a combination of questionnaires administered to the cohort regularly throughout the 4-year period and administrative data from the Centers for Medicare and Medicaid Services. The existing data provides a rich set of indicators concerning beneficiaries' health care experiences and health outcomes, but do not include information about the technical quality of care. In the proposed study, while continuing to monitor the health, health care experiences and enrollment status of the study population, we will incorporate indicators of the technical quality of care by obtaining participants' medical records and applying the RAND Quality Assessment (QA) Tools system. This combination of data represents an unprecedented resource in its potential to measure and compare health care quality in a general elderly population in Medicare FFS and HMOs, and to examine performance and outcome changes over a critical period in Medicare program development. The study's findings will address critical questions facing beneficiaries and policymakers as the nation debates Medicare program reform.